The Satellite News Financial Ticker

By | August 11, 2003 | Feature

Week of August 1 – 7, 2003
Percentage Change

Symbol
Aug. 7 Price
One Week
One Month
Three Month
Year to Date
Operators
APT SATELLITE HLDGS ATS
2.43
(22.9)
(11.6)
89.8
41.3
ASIASAT TELECOM SAT
16.70
(0.6)
2.8
18.4
46.6
BRITISH SKY BROADCASTING BSY
44.35
(4.3)
(2.0)
1.6
10.7
ECHOSTAR COMM -CL A DISH
35.37
(1.8)
1.1
9.9
58.9
HUGHES ELEC (GM -CL H) GMH
13.34
(3.2)
1.6
3.8
24.7
LORAL SPACE & COMM LOR
0.22
(92.1)
(94.6)
(94.9)
NEWS CORP NWS
30.33
0.9
(0.3)
4.8
15.5
NEW SKIES SATELLITES NSK
5.65
(1.1)
5.8
10.8
36.1
PANAMSAT SPOT
16.25
(6.4)
(10.5)
(9.3)
11.0
PASIFIK SATELIT NUSANTARA PSNRY
0.16
10.7
6.9
3.3
PEGASUS COMMUNICATIONS PGTV
36.12
(4.7)
22.4
11.7
175.7
rSTAR CORP RSTRC
1.09
105.7
94.6
98.2
354.2
SES GLOBAL SES.LU
6.11
3.4
11.1
19.8
(4.5)
SIRIUS SATELLITE RADIO SIRI
1.53
(13.6)
(17.0)
26.6
139.1
XM SATELLITE RADIO XMSR
10.52
(21.9)
(18.2)
(7.6)
291.1
Operators’ Average
100.00
2.0
(0.1)
12.7
73.9
Manufacturers
ANDREW ANDW
10.00
(8.8)
(2.7)
10.5
(2.7)
BALL BLL
48.86
(1.2)
8.3
(14.5)
(4.6)
BOEING BA
31.93
(1.8)
(7.7)
13.5
(3.2)
COM DEV INTL CDV
0.44
(18.5)
(15.4)
18.9
(26.7)
EMS TECHNOLOGIES ELMG
16.31
(6.1)
15.3
35.9
4.8
GARMEN LTD. GRMN
36.25
(5.9)
(10.8)
(21.4)
23.7
GILAT SAT NETWORKS GILTF
4.54
(4.2)
(10.1)
2.3
(41.8)
GLOBECOM GCOM
3.91
5.7
11.7
34.8
4.3
HARRIS HRS
30.39
(6.5)
0.6
6.0
15.6
HONEYWELL HON
27.65
(2.5)
1.8
13.3
15.2
KVH KVHI
18.93
(4.2)
(17.1)
22.1
120.1
LOCKHEED MARTIN LMT
49.70
(5.2)
2.7
(0.2)
(13.9)
LUCENT TECHNOLOGIES LU
1.76
0.6
(12.0)
(20.0)
39.7
MOTOROLA MOT
9.27
1.9
(3.1)
13.7
7.2
NERA NERAY
2.16
8.5
50.3
77.8
99.1
ORBITAL SCIENCES ORB
8.04
(2.9)
8.5
36.5
90.5
QUALCOMM QCOM
36.41
(2.5)
(2.8)
10.9
0.1
RAYTHEON RTN
30.10
(1.8)
(8.4)
0.5
(2.1)
ROCKWELL COLLINS COL
25.35
(2.9)
0.4
15.2
9.0
SCIENTIFIC-ATLANTA SFA
28.20
(4.0)
11.7
72.0
137.8
SKY FRAMES SKYU
1.07
(2.7)
(28.7)
(14.4)
(86.6)
STM WIRELESS STMI
0.00
(80.0)
(93.3)
100.0
(99.5)
TITAN TTN
15.31
(2.7)
49.4
76.0
47.2
TRIMBLE NAVIGATION TRMB
24.92
(8.7)
4.4
2.9
99.5
VIASAT VSAT
13.06
(5.8)
(7.6)
6.2
13.2
Manufacturers’ Average
100.00
(6.5)
(2.2)
19.9
17.8
Nasdaq Composite Index
S & P 500 COMP
1,652.18
(4.0)
(0.7)
8.4
23.7
SN Stock Price Average SP50
974.12
(1.4)
(1.2)
4.3
10.7
100.00
(3.3)
(1.4)
17.2
38.9

Wall Street Analysis

By Tom Watts, SG Cowen Securities

XM Satellite Radio [Nasdaq: XMSR] surprised many investors with its second quarter results. Along with excellent subscriber numbers, the company announced it would replace its ailing Boeing [NYSE: BA] satellites with two new satellites scheduled for launch in the fourth quarter of 2004 and in 2005. While the replacement satellites were not a surprise – we knew the Boeing 702s had to be replaced, the timing of the replacement was earlier than the 2006 timeframe we had expected.

What’s an even greater surprise for many is that XM can afford these satellites. With its second quarter cash balance of $346 million, it can fully fund the $190 million cost of XM-3. Provided it receives an insurance settlement – which we believe is likely despite the insurance carriers challenging the claim (something satellite insurance carriers seem to do frequently) – it can also afford to construct the XM-4 satellite. Overall, XM still looks like it is fully funded until it reaches break-even cash flow.

XM reported good news on the automotive front. In addition to the 800,000 vehicles that General Motors [NYSE: GM] will equip with XM in the 2004 model year, Honda [NYSE: HMC] will equip an additional 200,000. At the 75 percent take up rate XM has been realizing, this suggests at least 750,000 new subscribers through the original equipment manufacturer (OEM) channel alone.

XM is also demonstrating success in after-market sales as well. A full 60 percent of the second quarter’s 209,000 net new subscribers came through these retailers. With the addition of Wal-Mart [NYSE: WMT] and the release of new products for the holiday selling season, this channel should accelerate as well.

We believe the combination of OEM and retail sales could produce 1.5 million new subscribers in the next 12 months. That should put XM on track to more than pay for its accelerated satellite replacements. We believe it will also demonstrate that satellite radio is firmly on track to become a major mass market entertainment service.

Tom Watts is a managing director and satellite analyst at SG Cowen Securities. He can be reached by phone at 212/278-4260 or by e-mail at tom.watts@sgcowen.com. Readers should assume that SG Cowen Securities Corp. and/or its affiliates intend to offer services in investment banking to the above referenced companies within the next three months, and to seek compensation for such services.

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